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Military Tax Deduction

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Military Tax Deduction

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The Military Tax Deduction

Military tax deduction Publication 915 - Main Content Table of Contents Are Any of Your Benefits Taxable?Worksheet A. Military tax deduction Exemption from withholding. Military tax deduction How To Report Your Benefits How Much Is Taxable?Examples Lump-Sum ElectionExample Deductions Related to Your BenefitsRepayments More Than Gross Benefits Worksheets AppendixForm SSA-1099, Social Security Benefit Statement 2013 Form SSA-1042S, Social Security Benefit Statement 2013 (Nonresident Aliens) Form RRB-1099, Payments by the Railroad Retirement Board 2013 Form RRB-1042S, Payments by the Railroad Retirement Board 2013 (Nonresident Aliens) How To Get Tax HelpLow Income Taxpayer Clinics Are Any of Your Benefits Taxable? To find out whether any of your benefits shown on Forms SSA-1099 and RRB-1099 may be taxable, compare the base amount (explained later) for your filing status with the total of: One-half of your benefits, plus All your other income, including tax-exempt interest. Military tax deduction When making this comparison, do not reduce your other income by any exclusions for: Interest from qualified U. Military tax deduction S. Military tax deduction savings bonds, Employer-provided adoption benefits, Foreign earned income or foreign housing, or Income earned by bona fide residents of American Samoa or Puerto Rico. Military tax deduction Children's benefits. Military tax deduction   The rules in this publication apply to benefits received by children. Military tax deduction See Who is taxed , later. Military tax deduction The SSA issues Form SSA-1099 and Form SSA-1042S. Military tax deduction The RRB issues Form RRB-1099 and Form RRB-1042S. Military tax deduction These forms (tax statements) report the amounts paid and repaid, and taxes withheld for a tax year. Military tax deduction You may receive more than one of these forms for the same tax year. Military tax deduction See the Appendix at the end of this publication for more information. Military tax deduction Each original Form RRB-1099 or Form RRB-1042S is valid unless it has been corrected. Military tax deduction The RRB will issue a corrected Form RRB-1099 or Form RRB-1042S if there is an error in the original. Military tax deduction A corrected Form RRB-1099 or Form RRB-1042S is indicated as “CORRECTED” and replaces the corresponding original Form RRB-1099 or Form RRB-1042S. Military tax deduction You must use the latest corrected Form RRB-1099 or Form RRB-1042S you received and any original Form RRB-1099 or Form RRB-1042S that the RRB has not corrected when you determine what amounts to report on your tax return. Military tax deduction Figuring total income. Military tax deduction   To figure the total of one-half of your benefits plus your other income, use Worksheet A, discussed later. Military tax deduction If the total is more than your base amount, part of your benefits may be taxable. Military tax deduction   If you are married and file a joint return for 2013, you and your spouse must combine your incomes and your benefits to figure whether any of your combined benefits are taxable. Military tax deduction Even if your spouse did not receive any benefits, you must add your spouse's income to yours to figure whether any of your benefits are taxable. Military tax deduction If the only income you received during 2013 was your social security or the SSEB portion of tier 1 railroad retirement benefits, your benefits generally are not taxable and you probably do not have to file a return. Military tax deduction If you have income in addition to your benefits, you may have to file a return even if none of your benefits are taxable. Military tax deduction Base amount. Military tax deduction   Your base amount is: $25,000 if you are single, head of household, or qualifying widow(er), $25,000 if you are married filing separately and lived apart from your spouse for all of 2013, $32,000 if you are married filing jointly, or $-0- if you are married filing separately and lived with your spouse at any time during 2013. Military tax deduction Worksheet A. Military tax deduction   You can use Worksheet A to figure the amount of income to compare with your base amount. Military tax deduction This is a quick way to check whether some of your benefits may be taxable. Military tax deduction     Worksheet A. Military tax deduction A Quick Way To Check if Your Benefits May Be Taxable Keep for your records A. Military tax deduction Enter the amount from box 5 of all your Forms SSA-1099 and RRB-1099. Military tax deduction Include the full amount of any lump-sum benefit payments received in 2013, for 2013 and earlier years. Military tax deduction (If you received more than one form, combine the amounts from box 5 and enter the total. Military tax deduction ) A. Military tax deduction   Note. Military tax deduction If the amount on line A is zero or less, stop here; none of your benefits are taxable this year. Military tax deduction B. Military tax deduction Enter one-half of the amount on line A B. Military tax deduction   C. Military tax deduction Enter your taxable pensions, wages, interest, dividends, and other taxable income C. Military tax deduction   D. Military tax deduction Enter any tax-exempt interest income (such as interest on municipal bonds) plus any exclusions from income (listed earlier) D. Military tax deduction   E. Military tax deduction Add lines B, C, and D E. Military tax deduction   Note. Military tax deduction Compare the amount on line E to your base amount for your filing status. Military tax deduction If the amount on line E equals or is less than the base amount for your filing status, none of your benefits are taxable this year. Military tax deduction If the amount on line E is more than your base amount, some of your benefits may be taxable. Military tax deduction You need to complete Worksheet 1, shown later. Military tax deduction If none of your benefits are taxable, but you otherwise must file a tax return, see Benefits not taxable , later, under How To Report Your Benefits . Military tax deduction   Example. Military tax deduction You and your spouse (both over 65) are filing a joint return for 2013 and you both received social security benefits during the year. Military tax deduction In January 2014, you received a Form SSA-1099 showing net benefits of $7,500 in box 5. Military tax deduction Your spouse received a Form SSA-1099 showing net benefits of $3,500 in box 5. Military tax deduction You also received a taxable pension of $22,800 and interest income of $500. Military tax deduction You did not have any tax-exempt interest income. Military tax deduction Your benefits are not taxable for 2013 because your income, as figured in Worksheet A below, is not more than your base amount ($32,000) for married filing jointly. Military tax deduction   Even though none of your benefits are taxable, you must file a return for 2013 because your taxable gross income ($23,300) exceeds the minimum filing requirement amount for your filing status. Military tax deduction     Filled-in Worksheet A. Military tax deduction A Quick Way To Check if Your Benefits May Be Taxable Keep for your records A. Military tax deduction Enter the amount from box 5 of all your Forms SSA-1099 and RRB-1099. Military tax deduction Include the full amount of any lump-sum benefit payments received in 2013, for 2013 and earlier years. Military tax deduction (If you received more than one form, combine the amounts from box 5 and enter the total. Military tax deduction ) A. Military tax deduction $11,000 Note. Military tax deduction If the amount on line A is zero or less, stop here; none of your benefits are taxable this year. Military tax deduction B. Military tax deduction Enter one-half of the amount on line A B. Military tax deduction 5,500 C. Military tax deduction Enter your taxable pensions, wages, interest, dividends, and other taxable income C. Military tax deduction 23,300 D. Military tax deduction Enter any tax-exempt interest income (such as interest on municipal bonds) plus any exclusions from income (listed earlier) D. Military tax deduction -0- E. Military tax deduction Add lines B, C, and D E. Military tax deduction $28,800 Note. Military tax deduction Compare the amount on line E to your base amount for your filing status. Military tax deduction If the amount on line E equals or is less than the base amount for your filing status, none of your benefits are taxable this year. Military tax deduction If the amount on line E is more than your base amount, some of your benefits may be taxable. Military tax deduction You need to complete Worksheet 1, shown later. Military tax deduction If none of your benefits are taxable, but you otherwise must file a tax return, see Benefits not taxable , later, under How To Report Your Benefits . Military tax deduction   Who is taxed. Military tax deduction   Benefits are included in the taxable income (to the extent they are taxable) of the person who has the legal right to receive the benefits. Military tax deduction For example, if you and your child receive benefits, but the check for your child is made out in your name, you must use only your part of the benefits to see whether any benefits are taxable to you. Military tax deduction One-half of the part that belongs to your child must be added to your child's other income to see whether any of those benefits are taxable to your child. Military tax deduction Repayment of benefits. Military tax deduction   Any repayment of benefits you made during 2013 must be subtracted from the gross benefits you received in 2013. Military tax deduction It does not matter whether the repayment was for a benefit you received in 2013 or in an earlier year. Military tax deduction If you repaid more than the gross benefits you received in 2013, see Repayments More Than Gross Benefits , later. Military tax deduction   Your gross benefits are shown in box 3 of Form SSA-1099 or Form RRB-1099. Military tax deduction Your repayments are shown in box 4. Military tax deduction The amount in box 5 shows your net benefits for 2013 (box 3 minus box 4). Military tax deduction Use the amount in box 5 to figure whether any of your benefits are taxable. Military tax deduction Example. Military tax deduction In 2012, you received $3,000 in social security benefits, and in 2013 you received $2,700. Military tax deduction In March 2013, SSA notified you that you should have received only $2,500 in benefits in 2012. Military tax deduction During 2013, you repaid $500 to SSA. Military tax deduction The Form SSA-1099 you received for 2013 shows $2,700 in box 3 (gross amount) and $500 in box 4 (repayment). Military tax deduction The amount in box 5 shows your net benefits of $2,200 ($2,700 minus $500). Military tax deduction Tax withholding and estimated tax. Military tax deduction   You can choose to have federal income tax withheld from your social security benefits and/or the SSEB portion of your tier 1 railroad retirement benefits. Military tax deduction If you choose to do this, you must complete a Form W-4V, Voluntary Withholding Statement. Military tax deduction   If you do not choose to have income tax withheld, you may have to request additional withholding from other income or pay estimated tax during the year. Military tax deduction For details, see Publication 505, Tax Withholding and Estimated Tax, or the instructions for Form 1040-ES, Estimated Tax for Individuals. Military tax deduction U. Military tax deduction S. Military tax deduction citizens residing abroad. Military tax deduction   U. Military tax deduction S. Military tax deduction citizens who are residents of the following countries are exempt from U. Military tax deduction S. Military tax deduction tax on their benefits. Military tax deduction Canada. Military tax deduction Egypt. Military tax deduction Germany. Military tax deduction Ireland. Military tax deduction Israel. Military tax deduction Italy. Military tax deduction (You must also be a citizen of Italy for the exemption to apply. Military tax deduction ) Romania. Military tax deduction United Kingdom. Military tax deduction   The SSA will not withhold U. Military tax deduction S. Military tax deduction tax from your benefits if you are a U. Military tax deduction S. Military tax deduction citizen. Military tax deduction   The RRB will withhold U. Military tax deduction S. Military tax deduction tax from your benefits unless you file Form RRB-1001, Nonresident Questionnaire, with the RRB to provide citizenship and residency information. Military tax deduction If you do not file Form RRB-1001, the RRB will consider you a nonresident alien and withhold tax from your railroad retirement benefits at a 30% rate. Military tax deduction Contact the RRB to get this form. Military tax deduction Lawful permanent residents. Military tax deduction   For U. Military tax deduction S. Military tax deduction income tax purposes, lawful permanent residents (green card holders) are considered resident aliens until their lawful permanent resident status under the immigration laws is either taken away or is administratively or judicially determined to have been abandoned. Military tax deduction Social security benefits paid to a green card holder are not subject to 30% withholding. Military tax deduction If you are a green card holder and tax was withheld in error on your social security benefits because you have a foreign address, the withholding tax is refundable by the Social Security Administration (SSA) or the IRS. Military tax deduction SSA will refund taxes erroneously withheld if the refund can be processed during the same calendar year in which the tax was withheld. Military tax deduction If SSA cannot refund the taxes withheld, you must file a Form 1040 or 1040A with the Internal Revenue Service Center, Austin, TX 73301 to determine if you are entitled to a refund. Military tax deduction You must also attach the following information to your Form 1040 or 1040A: A copy of the Form SSA-1042S, Social Security Benefit Statement, A copy of the “green card,” and A signed declaration that includes the following statements:    “The SSA should not have withheld federal income tax from my social security benefits because I am a U. Military tax deduction S. Military tax deduction lawful permanent resident and my green card has been neither revoked nor administratively or judicially determined to have been abandoned. Military tax deduction I am filing a U. Military tax deduction S. Military tax deduction income tax return for the tax year as a resident alien reporting all of my worldwide income. Military tax deduction I have not claimed benefits for the tax year under an income tax treaty as a nonresident alien. Military tax deduction ” Nonresident aliens. Military tax deduction   A nonresident alien is an individual who is not a citizen or resident of the United States. Military tax deduction If you are a nonresident alien, the rules discussed in this publication do not apply to you. Military tax deduction Instead, 85% of your benefits are taxed at a 30% rate, unless exempt (or subject to a lower rate) by treaty. Military tax deduction You will receive a Form SSA-1042S or Form RRB-1042S showing the amount of your benefits. Military tax deduction These forms will also show the tax rate and the amount of tax withheld from your benefits. Military tax deduction   Under tax treaties with the following countries, residents of these countries are exempt from U. Military tax deduction S. Military tax deduction tax on their benefits. Military tax deduction Canada. Military tax deduction Egypt. Military tax deduction Germany. Military tax deduction Ireland. Military tax deduction Israel. Military tax deduction Italy. Military tax deduction Japan. Military tax deduction Romania. Military tax deduction United Kingdom. Military tax deduction   Under a treaty with India, benefits paid to individuals who are both residents and nationals of India are exempt from U. Military tax deduction S. Military tax deduction tax if the benefits are for services performed for the United States, its subdivisions, or local government authorities. Military tax deduction   If you are a resident of Switzerland, your total benefit amount will be taxed at a 15% rate. Military tax deduction   For more information on whether you are a nonresident alien, see Publication 519, U. Military tax deduction S. Military tax deduction Tax Guide for Aliens. Military tax deduction Exemption from withholding. Military tax deduction   If your social security benefits are exempt from tax because you are a resident of one of the treaty countries listed, the SSA will not withhold U. Military tax deduction S. Military tax deduction tax from your benefits. Military tax deduction   If your railroad retirement benefits are exempt from tax because you are a resident of one of the treaty countries listed, you can claim an exemption from withholding by filing Form RRB-1001 with the RRB. Military tax deduction Contact the RRB to get this form. Military tax deduction Canadian or German social security benefits paid to U. Military tax deduction S. Military tax deduction residents. Military tax deduction   Under income tax treaties with Canada and Germany, social security benefits paid by those countries to U. Military tax deduction S. Military tax deduction residents are treated for U. Military tax deduction S. Military tax deduction income tax purposes as if they were paid under the social security legislation of the United States. Military tax deduction If you receive social security benefits from Canada or Germany, include them on line 1 of Worksheet 1, shown later. Military tax deduction How To Report Your Benefits If part of your benefits are taxable, you must use Form 1040 or Form 1040A. Military tax deduction You cannot use Form 1040EZ. Military tax deduction Reporting on Form 1040. Military tax deduction   Report your net benefits (the total amount from box 5 of all your Forms SSA-1099 and Forms RRB-1099) on line 20a and the taxable part on line 20b. Military tax deduction If you are married filing separately and you lived apart from your spouse for all of 2013, also enter “D” to the right of the word “benefits” on line 20a. Military tax deduction Reporting on Form 1040A. Military tax deduction   Report your net benefits (the total amount from box 5 of all your Forms SSA-1099 and Forms RRB-1099) on line 14a and the taxable part on line 14b. Military tax deduction If you are married filing separately and you lived apart from your spouse for all of 2013, also enter “D” to the right of the word “benefits” on line 14a. Military tax deduction Benefits not taxable. Military tax deduction   If you are filing Form 1040EZ, do not report any benefits on your tax return. Military tax deduction If you are filing Form 1040 or Form 1040A, report your net benefits (the total amount from box 5 of all your Forms SSA-1099 and Forms RRB-1099) on Form 1040, line 20a, or Form 1040A, line 14a. Military tax deduction Enter -0- on Form 1040, line 20b, or Form 1040A, line 14b. Military tax deduction If you are married filing separately and you lived apart from your spouse for all of 2013, also enter “D” to the right of the word “benefits” on Form 1040, line 20a, or Form 1040A, line 14a. Military tax deduction How Much Is Taxable? If part of your benefits are taxable, how much is taxable depends on the total amount of your benefits and other income. Military tax deduction Generally, the higher that total amount, the greater the taxable part of your benefits. Military tax deduction Maximum taxable part. Military tax deduction   Generally, up to 50% of your benefits will be taxable. Military tax deduction However, up to 85% of your benefits can be taxable if either of the following situations applies to you. Military tax deduction The total of one-half of your benefits and all your other income is more than $34,000 ($44,000 if you are married filing jointly). Military tax deduction You are married filing separately and lived with your spouse at any time during 2013. Military tax deduction Which worksheet to use. Military tax deduction   A worksheet you can use to figure your taxable benefits is in the instructions for your Form 1040 or 1040A. Military tax deduction You can use either that worksheet or Worksheet 1 in this publication, unless any of the following situations applies to you. Military tax deduction You contributed to a traditional individual retirement arrangement (IRA) and you or your spouse is covered by a retirement plan at work. Military tax deduction In this situation you must use the special worksheets in Appendix B of Publication 590 to figure both your IRA deduction and your taxable benefits. Military tax deduction Situation (1) does not apply and you take an exclusion for interest from qualified U. Military tax deduction S. Military tax deduction savings bonds (Form 8815), for adoption benefits (Form 8839), for foreign earned income or housing (Form 2555 or Form 2555-EZ), or for income earned in American Samoa (Form 4563) or Puerto Rico by bona fide residents. Military tax deduction In this situation, you must use Worksheet 1 in this publication to figure your taxable benefits. Military tax deduction You received a lump-sum payment for an earlier year. Military tax deduction In this situation, also complete Worksheet 2 or 3 and Worksheet 4 in this publication. Military tax deduction See Lump-Sum Election , later. Military tax deduction Examples A few examples you can use as a guide to figure the taxable part of your benefits follow. Military tax deduction Filled-in Worksheet 1. Military tax deduction Figuring Your Taxable Benefits Before you begin: If you are married filing separately and you lived apart from your spouse for all of 2013, enter “D” to the right of the word “benefits” on Form 1040, line 20a, or Form 1040A, line 14a. Military tax deduction Do not use this worksheet if you repaid benefits in 2013 and your total repayments (box 4 of Forms SSA-1099 and RRB-1099) were more than your gross benefits for 2013 (box 3 of Forms SSA-1099 and RRB-1099). Military tax deduction None of your benefits are taxable for 2013. Military tax deduction For more information, see Repayments More Than Gross Benefits . Military tax deduction If you are filing Form 8815, Exclusion of Interest From Series EE and I U. Military tax deduction S. Military tax deduction Savings Bonds Issued After 1989, do not include the amount from line 8a of Form 1040 or Form 1040A on line 3 of this worksheet. Military tax deduction Instead, include the amount from Schedule B (Form 1040A or 1040), line 2. Military tax deduction 1. Military tax deduction Enter the total amount from box 5 of ALL your Forms SSA-1099 and RRB-1099. Military tax deduction Also enter this amount on Form 1040, line 20a, or Form 1040A, line 14a 1. Military tax deduction $5,980         2. Military tax deduction Enter one-half of line 1 2. Military tax deduction 2,990     3. Military tax deduction Combine the amounts from: Form 1040: Lines 7, 8a, 9a, 10 through 14, 15b, 16b, 17 through 19, and 21 Form 1040A: Lines 7, 8a, 9a, 10, 11b, 12b, and 13 3. Military tax deduction 28,990     4. Military tax deduction Enter the amount, if any, from Form 1040 or 1040A, line 8b 4. Military tax deduction -0-     5. Military tax deduction Enter the total of any exclusions/adjustments for: Adoption benefits (Form 8839, line 28), Foreign earned income or housing (Form 2555, lines 45 and 50, or Form 2555-EZ, line 18), and Certain income of bona fide residents of American Samoa (Form 4563, line 15) or Puerto Rico 5. Military tax deduction -0-     6. Military tax deduction Combine lines 2, 3, 4, and 5 6. Military tax deduction 31,980     7. Military tax deduction Form 1040 filers: Enter the amounts from Form 1040, lines 23 through 32, and any write-in adjustments you entered on the dotted line next to line 36. Military tax deduction  Form 1040A filers: Enter the amounts from Form 1040A, lines 16 and 17 7. Military tax deduction -0-     8. Military tax deduction Is the amount on line 7 less than the amount on line 6?             No. Military tax deduction None of your social security benefits are taxable. Military tax deduction Enter -0- on Form 1040, line 20b, or Form 1040A, line 14b. Military tax deduction             Yes. Military tax deduction Subtract line 7 from line 6 8. Military tax deduction 31,980     9. Military tax deduction If you are:  Married filing jointly, enter $32,000 Single, head of household, qualifying widow(er), or married filing separately and you lived apart from your spouse for all of 2013, enter $25,000 9. Military tax deduction 25,000       Note. Military tax deduction If you are married filing separately and you lived with your spouse at any time in 2013, skip lines 9 through 16; multiply line 8 by 85% (. Military tax deduction 85) and enter the result on line 17. Military tax deduction Then go to line 18. Military tax deduction         10. Military tax deduction Is the amount on line 9 less than the amount on line 8?             No. Military tax deduction None of your benefits are taxable. Military tax deduction Enter -0- on Form 1040, line 20b, or on Form 1040A, line 14b. Military tax deduction If you are married filing separately and you lived apart from your spouse for all of 2013, be sure you entered “D” to the right of the word “benefits” on Form 1040, line 20a, or on Form 1040A, line 14a. Military tax deduction             Yes. Military tax deduction Subtract line 9 from line 8 10. Military tax deduction 6,980     11. Military tax deduction Enter $12,000 if married filing jointly; $9,000 if single, head of household, qualifying widow(er), or married filing separately and you lived apart from your spouse for all of 2013 11. Military tax deduction 9,000     12. Military tax deduction Subtract line 11 from line 10. Military tax deduction If zero or less, enter -0- 12. Military tax deduction -0-     13. Military tax deduction Enter the smaller of line 10 or line 11 13. Military tax deduction 6,980     14. Military tax deduction Enter one-half of line 13 14. Military tax deduction 3,490     15. Military tax deduction Enter the smaller of line 2 or line 14 15. Military tax deduction 2,990     16. Military tax deduction Multiply line 12 by 85% (. Military tax deduction 85). Military tax deduction If line 12 is zero, enter -0- 16. Military tax deduction -0-     17. Military tax deduction Add lines 15 and 16 17. Military tax deduction 2,990     18. Military tax deduction Multiply line 1 by 85% (. Military tax deduction 85) 18. Military tax deduction 5,083     19. Military tax deduction Taxable benefits. Military tax deduction Enter the smaller of line 17 or line 18. Military tax deduction Also enter this amount on Form 1040, line 20b, or Form 1040A, line 14b 19. Military tax deduction $2,990       If you received a lump-sum payment in 2013 that was for an earlier year, also complete Worksheet 2 or 3 and Worksheet 4 to see if you can report a lower taxable benefit. Military tax deduction         Example 1. Military tax deduction George White is single and files Form 1040 for 2013. Military tax deduction In addition to receiving social security payments, he received a fully taxable pension of $18,600, wages from a part-time job of $9,400, and taxable interest income of $990, for a total of $28,990. Military tax deduction He received a Form SSA-1099 in January 2014 that shows his net social security benefits of $5,980 in box 5. Military tax deduction   To figure his taxable benefits, George completes Worksheet 1, shown below. Military tax deduction On line 20a of his Form 1040, George enters his net benefits of $5,980. Military tax deduction On line 20b, he enters his taxable benefits of $2,990. Military tax deduction Example 2. Military tax deduction Ray and Alice Hopkins file a joint return on Form 1040A for 2013. Military tax deduction Ray is retired and received a fully taxable pension of $15,500. Military tax deduction He also received social security benefits and his Form SSA-1099 for 2013 shows net benefits of $5,600 in box 5. Military tax deduction Alice worked during the year and had wages of $14,000. Military tax deduction She made a deductible payment to her IRA account of $1,000. Military tax deduction Ray and Alice have two savings accounts with a total of $250 in taxable interest income. Military tax deduction They complete Worksheet 1, entering $29,750 ($15,500 + $14,000 + $250) on line 3. Military tax deduction They find none of Ray's social security benefits are taxable. Military tax deduction On Form 1040A, they enter $5,600 on line 14a and -0- on line 14b. Military tax deduction Filled-in Worksheet 1. Military tax deduction Figuring Your Taxable Benefits Before you begin: If you are married filing separately and you lived apart from your spouse for all of 2013, enter “D” to the right of the word “benefits” on Form 1040, line 20a, or Form 1040A, line 14a. Military tax deduction Do not use this worksheet if you repaid benefits in 2013 and your total repayments (box 4 of Forms SSA-1099 and RRB-1099) were more than your gross benefits for 2013 (box 3 of Forms SSA-1099 and RRB-1099). Military tax deduction None of your benefits are taxable for 2013. Military tax deduction For more information, see Repayments More Than Gross Benefits . Military tax deduction If you are filing Form 8815, Exclusion of Interest From Series EE and I U. Military tax deduction S. Military tax deduction Savings Bonds Issued After 1989, do not include the amount from line 8a of Form 1040 or Form 1040A on line 3 of this worksheet. Military tax deduction Instead, include the amount from Schedule B (Form 1040A or 1040), line 2. Military tax deduction 1. Military tax deduction Enter the total amount from box 5 of ALL your Forms SSA-1099 and RRB-1099. Military tax deduction Also enter this amount on Form 1040, line 20a, or Form 1040A, line 14a 1. Military tax deduction $5,600         2. Military tax deduction Enter one-half of line 1 2. Military tax deduction 2,800     3. Military tax deduction Combine the amounts from: Form 1040: Lines 7, 8a, 9a, 10 through 14, 15b, 16b, 17 through 19, and 21 Form 1040A: Lines 7, 8a, 9a, 10, 11b, 12b, and 13 3. Military tax deduction 29,750     4. Military tax deduction Enter the amount, if any, from Form 1040 or 1040A, line 8b 4. Military tax deduction -0-     5. Military tax deduction Enter the total of any exclusions/adjustments for: Adoption benefits (Form 8839, line 28), Foreign earned income or housing (Form 2555, lines 45 and 50, or Form 2555-EZ, line 18), and Certain income of bona fide residents of American Samoa (Form 4563, line 15) or Puerto Rico 5. Military tax deduction -0-     6. Military tax deduction Combine lines 2, 3, 4, and 5 6. Military tax deduction 32,550     7. Military tax deduction Form 1040 filers: Enter the amounts from Form 1040, lines 23 through 32, and any write-in adjustments you entered on the dotted line next to line 36. Military tax deduction  Form 1040A filers: Enter the amounts from Form 1040A, lines 16 and 17 7. Military tax deduction 1,000     8. Military tax deduction Is the amount on line 7 less than the amount on line 6?             No. Military tax deduction None of your social security benefits are taxable. Military tax deduction Enter -0- on Form 1040, line 20b, or Form 1040A, line 14b. Military tax deduction             Yes. Military tax deduction Subtract line 7 from line 6 8. Military tax deduction 31,550     9. Military tax deduction If you are:  Married filing jointly, enter $32,000 Single, head of household, qualifying widow(er), or married filing separately and you lived apart from your spouse for all of 2013, enter $25,000 9. Military tax deduction 32,000       Note. Military tax deduction If you are married filing separately and you lived with your spouse at any time in 2013, skip lines 9 through 16; multiply line 8 by 85% (. Military tax deduction 85) and enter the result on line 17. Military tax deduction Then go to line 18. Military tax deduction         10. Military tax deduction Is the amount on line 9 less than the amount on line 8?             No. Military tax deduction None of your benefits are taxable. Military tax deduction Enter -0- on Form 1040, line 20b, or on Form 1040A, line 14b. Military tax deduction If you are married filing separately and you lived apart from your spouse for all of 2013, be sure you entered “D” to the right of the word “benefits” on Form 1040, line 20a, or on Form 1040A, line 14a. Military tax deduction             Yes. Military tax deduction Subtract line 9 from line 8 10. Military tax deduction       11. Military tax deduction Enter $12,000 if married filing jointly; $9,000 if single, head of household, qualifying widow(er), or married filing separately and you lived apart from your spouse for all of 2013 11. Military tax deduction       12. Military tax deduction Subtract line 11 from line 10. Military tax deduction If zero or less, enter -0- 12. Military tax deduction       13. Military tax deduction Enter the smaller of line 10 or line 11 13. Military tax deduction       14. Military tax deduction Enter one-half of line 13 14. Military tax deduction       15. Military tax deduction Enter the smaller of line 2 or line 14 15. Military tax deduction       16. Military tax deduction Multiply line 12 by 85% (. Military tax deduction 85). Military tax deduction If line 12 is zero, enter -0- 16. Military tax deduction       17. Military tax deduction Add lines 15 and 16 17. Military tax deduction       18. Military tax deduction Multiply line 1 by 85% (. Military tax deduction 85) 18. Military tax deduction       19. Military tax deduction Taxable benefits. Military tax deduction Enter the smaller of line 17 or line 18. Military tax deduction Also enter this amount on Form 1040, line 20b, or Form 1040A, line 14b 19. Military tax deduction         If you received a lump-sum payment in 2013 that was for an earlier year, also complete Worksheet 2 or 3 and Worksheet 4 to see if you can report a lower taxable benefit. Military tax deduction         Example 3. Military tax deduction Joe and Betty Johnson file a joint return on Form 1040 for 2013. Military tax deduction Joe is a retired railroad worker and in 2013 received the social security equivalent benefit (SSEB) portion of tier 1 railroad retirement benefits. Military tax deduction Joe's Form RRB-1099 shows $10,000 in box 5. Military tax deduction Betty is a retired government worker and received a fully taxable pension of $38,000. Military tax deduction They had $2,300 in taxable interest income plus interest of $200 on a qualified U. Military tax deduction S. Military tax deduction savings bond. Military tax deduction The savings bond interest qualified for the exclusion. Military tax deduction They figure their taxable benefits by completing Worksheet 1 below. Military tax deduction Because they have qualified U. Military tax deduction S. Military tax deduction savings bond interest, they follow the note at the beginning of the worksheet and use the amount from line 2 of their Schedule B (Form 1040A or 1040) on line 3 of the worksheet instead of the amount from line 8a of their Form 1040. Military tax deduction On line 3 of the worksheet, they enter $40,500 ($38,000 + $2,500). Military tax deduction More than 50% of Joe's net benefits are taxable because the income on line 8 of the worksheet ($45,500) is more than $44,000. Military tax deduction (See Maximum taxable part under How Much Is Taxable earlier. Military tax deduction ) Joe and Betty enter $10,000 on Form 1040, line 20a, and $6,275 on Form 1040, line 20b. Military tax deduction Filled-in Worksheet 1. Military tax deduction Figuring Your Taxable Benefits Before you begin: If you are married filing separately and you lived apart from your spouse for all of 2013, enter “D” to the right of the word “benefits” on Form 1040, line 20a, or Form 1040A, line 14a. Military tax deduction Do not use this worksheet if you repaid benefits in 2013 and your total repayments (box 4 of Forms SSA-1099 and RRB-1099) were more than your gross benefits for 2013 (box 3 of Forms SSA-1099 and RRB-1099). Military tax deduction None of your benefits are taxable for 2013. Military tax deduction For more information, see Repayments More Than Gross Benefits . Military tax deduction If you are filing Form 8815, Exclusion of Interest From Series EE and I U. Military tax deduction S. Military tax deduction Savings Bonds Issued After 1989, do not include the amount from line 8a of Form 1040 or Form 1040A on line 3 of this worksheet. Military tax deduction Instead, include the amount from Schedule B (Form 1040A or 1040), line 2. Military tax deduction 1. Military tax deduction Enter the total amount from box 5 of ALL your Forms SSA-1099 and RRB-1099. Military tax deduction Also enter this amount on Form 1040, line 20a, or Form 1040A, line 14a 1. Military tax deduction $10,000         2. Military tax deduction Enter one-half of line 1 2. Military tax deduction 5,000     3. Military tax deduction Combine the amounts from: Form 1040: Lines 7, 8a, 9a, 10 through 14, 15b, 16b, 17 through 19, and 21 Form 1040A: Lines 7, 8a, 9a, 10, 11b, 12b, and 13 3. Military tax deduction 40,500     4. Military tax deduction Enter the amount, if any, from Form 1040 or 1040A, line 8b 4. Military tax deduction -0-     5. Military tax deduction Enter the total of any exclusions/adjustments for: Adoption benefits (Form 8839, line 28), Foreign earned income or housing (Form 2555, lines 45 and 50, or Form 2555-EZ, line 18), and Certain income of bona fide residents of American Samoa (Form 4563, line 15) or Puerto Rico 5. Military tax deduction -0-     6. Military tax deduction Combine lines 2, 3, 4, and 5 6. Military tax deduction 45,500     7. Military tax deduction Form 1040 filers: Enter the amounts from Form 1040, lines 23 through 32, and any write-in adjustments you entered on the dotted line next to line 36. Military tax deduction  Form 1040A filers: Enter the amounts from Form 1040A, lines 16 and 17 7. Military tax deduction -0-     8. Military tax deduction Is the amount on line 7 less than the amount on line 6?             No. Military tax deduction None of your social security benefits are taxable. Military tax deduction Enter -0- on Form 1040, line 20b, or Form 1040A, line 14b. Military tax deduction             Yes. Military tax deduction Subtract line 7 from line 6 8. Military tax deduction 45,500     9. Military tax deduction If you are:  Married filing jointly, enter $32,000 Single, head of household, qualifying widow(er), or married filing separately and you lived apart from your spouse for all of 2013, enter $25,000 9. Military tax deduction 32,000       Note. Military tax deduction If you are married filing separately and you lived with your spouse at any time in 2013, skip lines 9 through 16; multiply line 8 by 85% (. Military tax deduction 85) and enter the result on line 17. Military tax deduction Then go to line 18. Military tax deduction         10. Military tax deduction Is the amount on line 9 less than the amount on line 8?             No. Military tax deduction None of your benefits are taxable. Military tax deduction Enter -0- on Form 1040, line 20b, or on Form 1040A, line 14b. Military tax deduction If you are married filing separately and you lived apart from your spouse for all of 2013, be sure you entered “D” to the right of the word “benefits” on Form 1040, line 20a, or on Form 1040A, line 14a. Military tax deduction             Yes. Military tax deduction Subtract line 9 from line 8 10. Military tax deduction 13,500     11. Military tax deduction Enter $12,000 if married filing jointly; $9,000 if single, head of household, qualifying widow(er), or married filing separately and you lived apart from your spouse for all of 2013 11. Military tax deduction 12,000     12. Military tax deduction Subtract line 11 from line 10. Military tax deduction If zero or less, enter -0- 12. Military tax deduction 1,500     13. Military tax deduction Enter the smaller of line 10 or line 11 13. Military tax deduction 12,000     14. Military tax deduction Enter one-half of line 13 14. Military tax deduction 6,000     15. Military tax deduction Enter the smaller of line 2 or line 14 15. Military tax deduction 5,000     16. Military tax deduction Multiply line 12 by 85% (. Military tax deduction 85). Military tax deduction If line 12 is zero, enter -0- 16. Military tax deduction 1,275     17. Military tax deduction Add lines 15 and 16 17. Military tax deduction 6,275     18. Military tax deduction Multiply line 1 by 85% (. Military tax deduction 85) 18. Military tax deduction 8,500     19. Military tax deduction Taxable benefits. Military tax deduction Enter the smaller of line 17 or line 18. Military tax deduction Also enter this amount on Form 1040, line 20b, or Form 1040A, line 14b 19. Military tax deduction $6,275       If you received a lump-sum payment in 2013 that was for an earlier year, also complete Worksheet 2 or 3 and Worksheet 4 to see if you can report a lower taxable benefit. Military tax deduction         Filled-in Worksheet 1. Military tax deduction Figuring Your Taxable Benefits Before you begin: If you are married filing separately and you lived apart from your spouse for all of 2013, enter “D” to the right of the word “benefits” on Form 1040, line 20a, or Form 1040A, line 14a. Military tax deduction Do not use this worksheet if you repaid benefits in 2013 and your total repayments (box 4 of Forms SSA-1099 and RRB-1099) were more than your gross benefits for 2013 (box 3 of Forms SSA-1099 and RRB-1099). Military tax deduction None of your benefits are taxable for 2013. Military tax deduction For more information, see Repayments More Than Gross Benefits . Military tax deduction If you are filing Form 8815, Exclusion of Interest From Series EE and I U. Military tax deduction S. Military tax deduction Savings Bonds Issued After 1989, do not include the amount from line 8a of Form 1040 or Form 1040A on line 3 of this worksheet. Military tax deduction Instead, include the amount from Schedule B (Form 1040A or 1040), line 2. Military tax deduction 1. Military tax deduction Enter the total amount from box 5 of ALL your Forms SSA-1099 and RRB-1099. Military tax deduction Also enter this amount on Form 1040, line 20a, or Form 1040A, line 14a 1. Military tax deduction $4,000         2. Military tax deduction Enter one-half of line 1 2. Military tax deduction 2,000     3. Military tax deduction Combine the amounts from: Form 1040: Lines 7, 8a, 9a, 10 through 14, 15b, 16b, 17 through 19, and 21 Form 1040A: Lines 7, 8a, 9a, 10, 11b, 12b, and 13 3. Military tax deduction 8,000     4. Military tax deduction Enter the amount, if any, from Form 1040 or 1040A, line 8b 4. Military tax deduction -0-     5. Military tax deduction Enter the total of any exclusions/adjustments for: Adoption benefits (Form 8839, line 28), Foreign earned income or housing (Form 2555, lines 45 and 50, or Form 2555-EZ, line 18), and Certain income of bona fide residents of American Samoa (Form 4563, line 15) or Puerto Rico 5. Military tax deduction -0-     6. Military tax deduction Combine lines 2, 3, 4, and 5 6. Military tax deduction 10,000     7. Military tax deduction Form 1040 filers: Enter the amounts from Form 1040, lines 23 through 32, and any write-in adjustments you entered on the dotted line next to line 36. Military tax deduction  Form 1040A filers: Enter the amounts from Form 1040A, lines 16 and 17 7. Military tax deduction -0-     8. Military tax deduction Is the amount on line 7 less than the amount on line 6?             No. Military tax deduction None of your social security benefits are taxable. Military tax deduction Enter -0- on Form 1040, line 20b, or Form 1040A, line 14b. Military tax deduction             Yes. Military tax deduction Subtract line 7 from line 6 8. Military tax deduction 10,000     9. Military tax deduction If you are:  Married filing jointly, enter $32,000 Single, head of household, qualifying widow(er), or married filing separately and you lived apart from your spouse for all of 2013, enter $25,000 9. Military tax deduction         Note. Military tax deduction If you are married filing separately and you lived with your spouse at any time in 2013, skip lines 9 through 16; multiply line 8 by 85% (. Military tax deduction 85) and enter the result on line 17. Military tax deduction Then go to line 18. Military tax deduction         10. Military tax deduction Is the amount on line 9 less than the amount on line 8?             No. Military tax deduction None of your benefits are taxable. Military tax deduction Enter -0- on Form 1040, line 20b, or on Form 1040A, line 14b. Military tax deduction If you are married filing separately and you lived apart from your spouse for all of 2013, be sure you entered “D” to the right of the word “benefits” on Form 1040, line 20a, or on Form 1040A, line 14a. Military tax deduction             Yes. Military tax deduction Subtract line 9 from line 8 10. Military tax deduction       11. Military tax deduction Enter $12,000 if married filing jointly; $9,000 if single, head of household, qualifying widow(er), or married filing separately and you lived apart from your spouse for all of 2013 11. Military tax deduction       12. Military tax deduction Subtract line 11 from line 10. Military tax deduction If zero or less, enter -0- 12. Military tax deduction       13. Military tax deduction Enter the smaller of line 10 or line 11 13. Military tax deduction       14. Military tax deduction Enter one-half of line 13 14. Military tax deduction       15. Military tax deduction Enter the smaller of line 2 or line 14 15. Military tax deduction       16. Military tax deduction Multiply line 12 by 85% (. Military tax deduction 85). Military tax deduction If line 12 is zero, enter -0- 16. Military tax deduction       17. Military tax deduction Add lines 15 and 16 17. Military tax deduction 8,500     18. Military tax deduction Multiply line 1 by 85% (. Military tax deduction 85) 18. Military tax deduction 3,400     19. Military tax deduction Taxable benefits. Military tax deduction Enter the smaller of line 17 or line 18. Military tax deduction Also enter this amount on Form 1040, line 20b, or Form 1040A, line 14b 19. Military tax deduction $3,400       If you received a lump-sum payment in 2013 that was for an earlier year, also complete Worksheet 2 or 3 and Worksheet 4 to see if you can report a lower taxable benefit. Military tax deduction         Example 4. Military tax deduction Bill and Eileen Jones are married and live together, but file separate Form 1040 returns for 2013. Military tax deduction Bill earned $8,000 during 2013. Military tax deduction The only other income he had for the year was $4,000 net social security benefits (box 5 of his Form SSA-1099). Military tax deduction Bill figures his taxable benefits by completing Worksheet 1 below. Military tax deduction He must include 85% of his social security benefits in his taxable income because he is married filing separately and lived with his spouse during 2013. Military tax deduction See How Much Is Taxable earlier. Military tax deduction Bill enters $4,000 on his Form 1040, line 20a, and $3,400 on Form 1040, line 20b. Military tax deduction Lump-Sum Election You must include the taxable part of a lump-sum (retroactive) payment of benefits received in 2013 in your 2013 income, even if the payment includes benefits for an earlier year. Military tax deduction This type of lump-sum benefit payment should not be confused with the lump-sum death benefit that both the SSA and RRB pay to many of their beneficiaries. Military tax deduction No part of the lump-sum death benefit is subject to tax. Military tax deduction Generally, you use your 2013 income to figure the taxable part of the total benefits received in 2013. Military tax deduction However, you may be able to figure the taxable part of a lump-sum payment for an earlier year separately, using your income for the earlier year. Military tax deduction You can elect this method if it lowers your taxable benefits. Military tax deduction Under the lump-sum election method, you refigure the taxable part of all your benefits for the earlier year (including the lump-sum payment) using that year's income. Military tax deduction Then you subtract any taxable benefits for that year that you previously reported. Military tax deduction The remainder is the taxable part of the lump-sum payment. Military tax deduction Add it to the taxable part of your benefits for 2013 (figured without the lump-sum payment for the earlier year). Military tax deduction Because the earlier year's taxable benefits are included in your 2013 income, no adjustment is made to the earlier year's return. Military tax deduction Do not file an amended return for the earlier year. Military tax deduction Will the lump-sum election method lower your taxable benefits?   To find out, take the following steps. Military tax deduction Complete Worksheet 1 in this publication. Military tax deduction Complete Worksheet 2 and Worksheet 3 as appropriate. Military tax deduction Use Worksheet 2 if your lump-sum payment was for a year after 1993. Military tax deduction Use Worksheet 3 if it was for 1993 or an earlier year. Military tax deduction Complete a separate Worksheet 2 or Worksheet 3 for each earlier year for which you received the lump-sum payment. Military tax deduction Complete Worksheet 4. Military tax deduction Compare the taxable benefits on line 19 of Worksheet 1 with the taxable benefits on line 21 of Worksheet 4. Military tax deduction If the taxable benefits on Worksheet 4 are lower than the taxable benefits on Worksheet 1, you can elect to report the lower amount on your return. Military tax deduction Making the election. Military tax deduction   If you elect to report your taxable benefits under the lump-sum election method, follow the instructions at the bottom of Worksheet 4. Military tax deduction Do not attach the completed worksheets to your return. Military tax deduction Keep them with your records. Military tax deduction    Once you elect this method of figuring the taxable part of a lump-sum payment, you can revoke your election only with the consent of the IRS. Military tax deduction Lump-sum payment reported on Form SSA-1099 or RRB-1099. Military tax deduction   If you received a lump-sum payment in 2013 that includes benefits for one or more earlier years after 1983, it will be included in box 3 of either Form SSA-1099 or Form RRB-1099. Military tax deduction That part of any lump-sum payment for years before 1984 is not taxed and will not be shown on the form. Military tax deduction The form will also show the year (or years) the payment is for. Military tax deduction However, Form RRB-1099 will not show a breakdown by year (or years) of any lump-sum payment for years before 2011. Military tax deduction You must contact the RRB for a breakdown by year for any amount shown in box 9. Military tax deduction Example Jane Jackson is single. Military tax deduction In 2012 she applied for social security disability benefits but was told she was ineligible. Military tax deduction She appealed the decision and won. Military tax deduction In 2013, she received a lump-sum payment of $6,000, of which $2,000 was for 2012 and $4,000 was for 2013. Military tax deduction Jane also received $5,000 in social security benefits in 2013, so her total benefits in 2013 were $11,000. Military tax deduction Jane's other income for 2012 and 2013 is as follows. Military tax deduction   Income 2012 2013     Wages $20,000 $ 3,500     Interest income 2,000 2,500     Dividend income 1,000 1,500     Fully taxable pension   18,000     Total $23,000 $25,500   To see if the lump-sum election method results in lower taxable benefits, she completes Worksheets 1, 2, and 4 from this publication. Military tax deduction She does not need to complete Worksheet 3 because her lump-sum payment was for years after 1993. Military tax deduction Jane completes Worksheet 1 to find the amount of her taxable benefits for 2013 under the regular method. Military tax deduction She completes Worksheet 2 to find the taxable part of the lump-sum payment for 2012 under the lump-sum election method. Military tax deduction She completes Worksheet 4 to decide if the lump-sum election method will lower her taxable benefits. Military tax deduction After completing the worksheets, Jane compares the amounts from Worksheet 4, line 21, and Worksheet 1, line 19. Military tax deduction Because the amount on Worksheet 4 is smaller, she chooses to use the lump-sum election method. Military tax deduction To do this, she prints “LSE” to the left of Form 1040, line 20a. Military tax deduction She then enters $11,000 on Form 1040, line 20a, and her taxable benefits of $2,500 on line 20b. Military tax deduction Jane's filled-in worksheets (1, 2, and 4) follow. Military tax deduction Jane Jackson's Filled-in Worksheet 1. Military tax deduction Figuring Your Taxable Benefits Before you begin: If you are married filing separately and you lived apart from your spouse for all of 2013, enter “D” to the right of the word “benefits” on Form 1040, line 20a, or Form 1040A, line 14a. Military tax deduction Do not use this worksheet if you repaid benefits in 2013 and your total repayments (box 4 of Forms SSA-1099 and RRB-1099) were more than your gross benefits for 2013 (box 3 of Forms SSA-1099 and RRB-1099). Military tax deduction None of your benefits are taxable for 2013. Military tax deduction For more information, see Repayments More Than Gross Benefits . Military tax deduction If you are filing Form 8815, Exclusion of Interest From Series EE and I U. Military tax deduction S. Military tax deduction Savings Bonds Issued After 1989, do not include the amount from line 8a of Form 1040 or Form 1040A on line 3 of this worksheet. Military tax deduction Instead, include the amount from Schedule B (Form 1040A or 1040), line 2. Military tax deduction 1. Military tax deduction Enter the total amount from box 5 of ALL your Forms SSA-1099 and RRB-1099. Military tax deduction Also enter this amount on Form 1040, line 20a, or Form 1040A, line 14a 1. Military tax deduction $11,000         2. Military tax deduction Enter one-half of line 1 2. Military tax deduction 5,500     3. Military tax deduction Combine the amounts from: Form 1040: Lines 7, 8a, 9a, 10 through 14, 15b, 16b, 17 through 19, and 21 Form 1040A: Lines 7, 8a, 9a, 10, 11b, 12b, and 13 3. Military tax deduction 25,500     4. Military tax deduction Enter the amount, if any, from Form 1040 or 1040A, line 8b 4. Military tax deduction -0-     5. Military tax deduction Enter the total of any exclusions/adjustments for: Adoption benefits (Form 8839, line 28), Foreign earned income or housing (Form 2555, lines 45 and 50, or Form 2555-EZ, line 18), and Certain income of bona fide residents of American Samoa (Form 4563, line 15) or Puerto Rico 5. Military tax deduction -0-     6. Military tax deduction Combine lines 2, 3, 4, and 5 6. Military tax deduction 31,000     7. Military tax deduction Form 1040 filers: Enter the amounts from Form 1040, lines 23 through 32, and any write-in adjustments you entered on the dotted line next to line 36. Military tax deduction  Form 1040A filers: Enter the amounts from Form 1040A, lines 16 and 17 7. Military tax deduction -0-     8. Military tax deduction Is the amount on line 7 less than the amount on line 6?             No. Military tax deduction None of your social security benefits are taxable. Military tax deduction Enter -0- on Form 1040, line 20b, or Form 1040A, line 14b. Military tax deduction             Yes. Military tax deduction Subtract line 7 from line 6 8. Military tax deduction 31,000     9. Military tax deduction If you are:  Married filing jointly, enter $32,000 Single, head of household, qualifying widow(er), or married filing separately and you lived apart from your spouse for all of 2013, enter $25,000 9. Military tax deduction 25,000       Note. Military tax deduction If you are married filing separately and you lived with your spouse at any time in 2013, skip lines 9 through 16; multiply line 8 by 85% (. Military tax deduction 85) and enter the result on line 17. Military tax deduction Then go to line 18. Military tax deduction         10. Military tax deduction Is the amount on line 9 less than the amount on line 8?             No. Military tax deduction None of your benefits are taxable. Military tax deduction Enter -0- on Form 1040, line 20b, or on Form 1040A, line 14b. Military tax deduction If you are married filing separately and you lived apart from your spouse for all of 2013, be sure you entered “D” to the right of the word “benefits” on Form 1040, line 20a, or on Form 1040A, line 14a. Military tax deduction             Yes. Military tax deduction Subtract line 9 from line 8 10. Military tax deduction 6,000     11. Military tax deduction Enter $12,000 if married filing jointly; $9,000 if single, head of household, qualifying widow(er), or married filing separately and you lived apart from your spouse for all of 2013 11. Military tax deduction 9,000     12. Military tax deduction Subtract line 11 from line 10. Military tax deduction If zero or less, enter -0- 12. Military tax deduction -0-     13. Military tax deduction Enter the smaller of line 10 or line 11 13. Military tax deduction 6,000     14. Military tax deduction Enter one-half of line 13 14. Military tax deduction 3,000     15. Military tax deduction Enter the smaller of line 2 or line 14 15. Military tax deduction 3,000     16. Military tax deduction Multiply line 12 by 85% (. Military tax deduction 85). Military tax deduction If line 12 is zero, enter -0- 16. Military tax deduction -0-     17. Military tax deduction Add lines 15 and 16 17. Military tax deduction 3,000     18. Military tax deduction Multiply line 1 by 85% (. Military tax deduction 85) 18. Military tax deduction 9,350     19. Military tax deduction Taxable benefits. Military tax deduction Enter the smaller of line 17 or line 18. Military tax deduction Also enter this amount on Form 1040, line 20b, or Form 1040A, line 14b 19. Military tax deduction $3,000       If you received a lump-sum payment in 2013 that was for an earlier year, also complete Worksheet 2 or 3 and Worksheet 4 to see if you can report a lower taxable benefit. Military tax deduction         Jane Jackson's Filled-in Worksheet 2. Military tax deduction Figure Your Additional Taxable Benefits (From a Lump-Sum Payment for a Year After 1993)     Enter earlier year 2012 1. Military tax deduction Enter the total amount from box 5 of ALL your Forms SSA-1099 and RRB-1099 for the earlier year, plus the lump-sum payment for the earlier year received after that year 1. Military tax deduction $2,000           Note. Military tax deduction If line 1 is zero or less, skip lines 2 through 20 and enter -0- on line 21. Military tax deduction Otherwise, go on to line 2. Military tax deduction             2. Military tax deduction Enter one-half of line 1 2. Military tax deduction 1,000   3. Military tax deduction Enter your adjusted gross income for the earlier year 3. Military tax deduction 23,000   4. Military tax deduction Enter the total of any exclusions/adjustments you claimed in the earlier year for: Adoption benefits (Form 8839) Qualified U. Military tax deduction S. Military tax deduction savings bond interest (Form 8815) Student loan interest (Form 1040, page 1, or Form 1040A, page 1) Tuition and fees (Form 1040, page 1, or Form 1040A, page 1) Domestic production activities (for 2005 through 2012) (Form 1040, page 1) Foreign earned income or housing (Form 2555 or Form 2555-EZ) Certain income of bona fide residents of American Samoa (Form 4563) or Puerto Rico 4. Military tax deduction -0-   5. Military tax deduction Enter any tax-exempt interest received in the earlier year 5. Military tax deduction -0-   6. Military tax deduction Add lines 2 through 5 6. Military tax deduction 24,000   7. Military tax deduction Enter your taxable benefits for the earlier year that you previously reported 7. Military tax deduction -0-   8. Military tax deduction Subtract line 7 from line 6 8. Military tax deduction 24,000   9. Military tax deduction If, for the earlier year, you were:     Married filing jointly, enter $32,000 Single, head of household, qualifying widow(er), married filing separately and you lived apart from your spouse for all of the earlier year, enter $25,000 9. Military tax deduction 25,000     Note. Military tax deduction If you were married filing separately and you lived with your spouse at any time during the earlier year, skip lines 9 through 16; multiply line 8 by 85% (. Military tax deduction 85) and enter the result on line 17. Military tax deduction Then go to line 18. Military tax deduction         10. Military tax deduction Is the amount on line 8 more than the amount on line 9?       No. Military tax deduction Skip lines 10 through 20 and enter -0- on line 21. Military tax deduction       Yes. Military tax deduction Subtract line 9 from line 8 10. Military tax deduction     11. Military tax deduction Enter $12,000 if married filing jointly for the earlier year; $9,000 if single, head of household, qualifying widow(er), or married filing separately and you lived apart from your spouse for all of the earlier year 11. Military tax deduction     12. Military tax deduction Subtract line 11 from line 10. Military tax deduction If zero or less, enter -0- 12. Military tax deduction     13. Military tax deduction Enter the smaller of line 10 or line 11 13. Military tax deduction     14. Military tax deduction Enter one-half of line 13 14. Military tax deduction     15. Military tax deduction Enter the smaller of line 2 or line 14 15. Military tax deduction     16. Military tax deduction Multiply line 12 by 85% (. Military tax deduction 85). Military tax deduction If line 12 is zero, enter -0- 16. Military tax deduction     17. Military tax deduction Add lines 15 and 16 17. Military tax deduction     18. Military tax deduction Multiply line 1 by 85% (. Military tax deduction 85) 18. Military tax deduction     19. Military tax deduction Refigured taxable benefits. Military tax deduction Enter the smaller of line 17 or line 18 19. Military tax deduction     20. Military tax deduction Enter your taxable benefits for the earlier year (or as refigured due to a previous lump-sum payment for the year) 20. Military tax deduction     21. Military tax deduction Additional taxable benefits. Military tax deduction Subtract line 20 from line 19. Military tax deduction Also enter this amount on Worksheet 4, line 20 21. Military tax deduction -0-     Do not file an amended return for this earlier year. Military tax deduction Complete a separate Worksheet 2 or Worksheet 3 for each earlier year for which you received a lump-sum payment in 2013. Military tax deduction   Jane Jackson's Filled-in Worksheet 4. Military tax deduction Figure Your Taxable Benefits Under the Lump-Sum Election Method (Use With Worksheet 2 or 3)     Complete Worksheet 1 and Worksheets 2 and 3 as appropriate before completing this worksheet. Military tax deduction 1. Military tax deduction Enter the total amount from box 5 of ALL your Forms SSA-1099 and RRB-1099 for 2013, minus the lump-sum payment for years before 2013 1. Military tax deduction $9,000         Note. Military tax deduction If line 1 is zero or less, skip lines 2 through 18, enter -0- on line 19 and go to line 20. Military tax deduction Otherwise, go on to line 2. Military tax deduction           2. Military tax deduction Enter one-half of line 1 2. Military tax deduction 4,500   3. Military tax deduction Enter the amount from Worksheet 1, line 3 3. Military tax deduction 25,500   4. Military tax deduction Enter the amount from Worksheet 1, line 4 4. Military tax deduction -0-   5. Military tax deduction Enter the amount from Worksheet 1, line 5 5. Military tax deduction -0-   6. Military tax deduction Combine lines 2, 3, 4, and 5 6. Military tax deduction 30,000   7. Military tax deduction Enter the amount from Worksheet 1, line 7 7. Military tax deduction -0-   8. Military tax deduction Subtract line 7 from line 6 8. Military tax deduction 30,000   9. Military tax deduction Enter the amount from Worksheet 1, line 9. Military tax deduction But if you are married filing separately and lived with your spouse at any time during 2013, skip lines 9 through 16; multiply line 8 by 85% (. Military tax deduction 85) and enter the result on line 17. Military tax deduction Then, go to line 18 9. Military tax deduction 25,000   10. Military tax deduction Is the amount on line 8 more than the amount on line 9? No. Military tax deduction Skip lines 10 through 18, enter -0- on line 19, and go to line 20. Military tax deduction  Yes. Military tax deduction Subtract line 9 from line 8 10. Military tax deduction 5,000   11. Military tax deduction Enter the amount from Worksheet 1, line 11 11. Military tax deduction 9,000   12. Military tax deduction Subtract line 11 from line 10. Military tax deduction If zero or less, enter -0- 12. Military tax deduction -0-   13. Military tax deduction Enter the smaller of line 10 or line 11 13. Military tax deduction 5,000   14. Military tax deduction Enter one-half of line 13 14. Military tax deduction 2,500   15. Military tax deduction Enter the smaller of line 2 or line 14 15. Military tax deduction 2,500   16. Military tax deduction Multiply line 12 by 85% (. Military tax deduction 85). Military tax deduction If line 12 is zero, enter -0- 16. Military tax deduction -0-   17. Military tax deduction Add lines 15 and 16 17. Military tax deduction 2,500   18. Military tax deduction Multiply line 1 by 85% (. Military tax deduction 85) 18. Military tax deduction 7,650   19. Military tax deduction Enter the smaller of line 17 or line 18 19. Military tax deduction 2,500   20. Military tax deduction Enter the total of the amounts from Worksheet 2, line 21, and Worksheet 3, line 14, for all earlier years for which the lump-sum payment was received 20. Military tax deduction -0-   21. Military tax deduction Taxable benefits under lump-sum election method. Military tax deduction Add lines 19 and 20 21. Military tax deduction $2,500   Next. Military tax deduction Is line 21 above smaller than Worksheet 1, line 19? No. Military tax deduction Do not use this method to figure your taxable benefits. Military tax deduction Follow the instructions on Worksheet 1 to report your benefits. Military tax deduction  Yes. Military tax deduction You can elect to report your taxable benefits under this method. Military tax deduction To elect this method:     Enter “LSE” to the left of Form 1040, line 20a, or Form 1040A, line 14a. Military tax deduction If line 21 above is zero, follow the instructions in line 10 for “No” on Worksheet 1. Military tax deduction Otherwise: Enter the amount from Worksheet 1, line 1, on Form 1040, line 20a, or on Form 1040A, line 14a. Military tax deduction Enter the amount from line 21 above on Form 1040, line 20b, or on Form 1040A, line 14b. Military tax deduction If you are married filing separately and you lived apart from your spouse for all of 2013, enter “D” to the right of the word “benefits” on Form 1040, line 20a, or Form 1040A, line 14a. Military tax deduction   Deductions Related to Your Benefits You may be entitled to deduct certain amounts related to the benefits you receive. Military tax deduction Disability payments. Military tax deduction   You may have received disability payments from your employer or an insurance company that you included as income on your tax return in an earlier year. Military tax deduction If you received a lump-sum payment from SSA or RRB, and you had to repay the employer or insurance company for the disability payments, you can take an itemized deduction for the part of the payments you included in gross income in the earlier year. Military tax deduction If the amount you repay is more than $3,000, you may be able to claim a tax credit instead. Military tax deduction Claim the deduction or credit in the same way explained under Repayment of benefits received in an earlier year in the section Repayments More Than Gross Benefits , later. Military tax deduction Legal expenses. Military tax deduction   You can usually deduct legal expenses that you pay or incur to produce or collect taxable income or in connection with the determination, collection, or refund of any tax. Military tax deduction   Legal expenses for collecting the taxable part of your benefits are deductible as a miscellaneous itemized deduction on Schedule A (Form 1040), line 23. Military tax deduction Repayments More Than Gross Benefits In some situations, your Form SSA-1099 or Form RRB-1099 will show that the total benefits you repaid (box 4) are more than the gross benefits (box 3) you received. Military tax deduction If this occurred, your net benefits in box 5 will be a negative figure (a figure in parentheses) and none of your benefits will be taxable. Military tax deduction Do not use Worksheet 1 in this case. Military tax deduction If you receive more than one form, a negative figure in box 5 of one form is used to offset a positive figure in box 5 of another form for that same year. Military tax deduction If you have any questions about this negative figure, contact your local SSA office or your local RRB field office. Military tax deduction Joint return. Military tax deduction   If you and your spouse file a joint return, and your Form SSA-1099 or RRB-1099 has a negative figure in box 5, but your spouse's does not, subtract the amount in box 5 of your form from the amount in box 5 of your spouse's form. Military tax deduction You do this to get your net benefits when figuring if your combined benefits are taxable. Military tax deduction Example. Military tax deduction John and Mary file a joint return for 2013. Military tax deduction John received Form SSA-1099 showing $3,000 in box 5. Military tax deduction Mary also received Form SSA-1099 and the amount in box 5 was ($500). Military tax deduction John and Mary will use $2,500 ($3,000 minus $500) as the amount of their net benefits when figuring if any of their combined benefits are taxable. Military tax deduction Repayment of benefits received in an earlier year. Military tax deduction   If the total amount shown in box 5 of all of your Forms SSA-1099 and RRB-1099 is a negative figure, you can take an itemized deduction for the part of this negative figure that represents benefits you included in gross income in an earlier year. Military tax deduction Deduction $3,000 or less. Military tax deduction   If this deduction is $3,000 or less, it is subject to the 2%-of-adjusted-gross-income limit that applies to certain miscellaneous itemized deductions. Military tax deduction Claim it on Schedule A (Form 1040), line 23. Military tax deduction Deduction more than $3,000. Military tax deduction   If this deduction is more than $3,000, you should figure your tax two ways: Figure your tax for 2013 with the itemized deduction included on Schedule A, line 28. Military tax deduction Figure your tax for 2013 in the following steps: Figure the tax without the itemized deduction included on Schedule A, line 28. Military tax deduction For each year after 1983 for which part of the negative figure represents a repayment of benefits, refigure your taxable benefits as if your total benefits for the year were reduced by that part of the negative figure. Military tax deduction Then refigure the tax for that year. Military tax deduction Subtract the total of the refigured tax amounts in (b) from the total of your actual tax amounts. Military tax deduction Subtract the result in (c) from the result in (a). Military tax deduction   Compare the tax figured in methods (1) and (2). Military tax deduction Your tax for 2013 is the smaller of the two amounts. Military tax deduction If method (1) results in less tax, take the itemized deduction on Schedule A (Form 1040), line 28. Military tax deduction If method (2) results in less tax, claim a credit for the amount from step 2(c) above on Form 1040, line 71. Military tax deduction Check box d and enter “I. Military tax deduction R. Military tax deduction C. Military tax deduction 1341” in the space next to that box. Military tax deduction If both methods produce the same tax, deduct the repayment on Schedule A (Form 1040), line 28. Military tax deduction Worksheets Blank Worksheets 1 through 4 are provided in this section: Worksheet 1, Figuring Your Taxable Benefits; Worksheet 2, Figure Your Additional Taxable Benefits (From a Lump-Sum Payment for a Year After 1993); Worksheet 3, Figure Your Additional Taxable Benefits (From a Lump-Sum Payment for a Year Before 1994); Worksheet 4, Figure Your Taxable Benefits Under the Lump-Sum Election Method (Use With Worksheet 2 or 3). Military tax deduction Worksheet 1. Military tax deduction Figuring Your Taxable Benefits Before you begin: If you are married filing separately and you lived apart from your spouse for all of 2013, enter “D” to the right of the word “benefits” on Form 1040, line 20a, or Form 1040A, line 14a. Military tax deduction Do not use this worksheet if you repaid benefits in 2013 and your total repayments (box 4 of Forms SSA-1099 and RRB-1099) were more than your gross benefits for 2013 (box 3 of Forms SSA-1099 and RRB-1099). Military tax deduction None of your benefits are taxable for 2013. Military tax deduction For more information, see Repayments More Than Gross Benefits . Military tax deduction If you are filing Form 8815, Exclusion of Interest From Series EE and I U. Military tax deduction S. Military tax deduction Savings Bonds Issued After 1989, do not include the amount from line 8a of Form 1040 or Form 1040A on line 3 of this worksheet. Military tax deduction Instead, include the amount from Schedule B (Form 1040A or 1040), line 2. Military tax deduction 1. Military tax deduction Enter the total amount from box 5 of ALL your Forms SSA-1099 and RRB-1099. Military tax deduction Also enter this amount on Form 1040, line 20a, or Form 1040A, line 14a 1. Military tax deduction           2. Military tax deduction Enter one-half of line 1 2. Military tax deduction       3. Military tax deduction Combine the amounts from: Form 1040: Lines 7, 8a, 9a, 10 through 14, 15b, 16b, 17 through 19, and 21 Form 1040A: Lines 7, 8a, 9a, 10, 11b, 12b, and 13 3. Military tax deduction       4. Military tax deduction Enter the amount, if any, from Form 1040 or 1040A, line 8b 4. Military tax deduction       5. Military tax deduction Enter the total of any exclusions/adjustments for: Adoption benefits (Form 8839, line 28), Foreign earned income or housing (Form 2555, lines 45 and 50, or Form 2555-EZ, line 18), and Certain income of bona fide residents of American Samoa (Form 4563, line 15) or Puerto Rico 5. Military tax deduction       6. Military tax deduction Combine lines 2, 3, 4, and 5 6. Military tax deduction       7. Military tax deduction Form 1040 filers: Enter the amounts from Form 1040, lines 23 through 32, and any write-in adjustments you entered on the dotted line next to line 36. Military tax deduction  Form 1040A filers: Enter the amounts from Form 1040A, lines 16 and 17 7. Military tax deduction       8. Military tax deduction Is the amount on line 7 less than the amount on line 6?             No. Military tax deduction None of your social security benefits are taxable. Military tax deduction Enter -0- on Form 1040, line 20b, or Form 1040A, line 14b. Military tax deduction             Yes. Military tax deduction Subtract line 7 from line 6 8. Military tax deduction       9. Military tax deduction If you are:  Married filing jointly, enter $32,000 Single, head of household, qualifying widow(er), or married filing separately and you lived apart from your spouse for all of 2013, enter $25,000 9. Military tax deduction         Note. Military tax deduction If you are married filing separately and you lived with your spouse at any time in 2013, skip lines 9 through 16; multiply line 8 by 85% (. Military tax deduction 85) and enter the result on line 17. Military tax deduction Then go to line 18. Military tax deduction         10. Military tax deduction Is the amount on line 9 less than the amount on line 8?             No. Military tax deduction None of your benefits are taxable. Military tax deduction Enter -0- on Form 1040, line 20b, or on Form 1040A, line 14b. Military tax deduction If you are married filing separately and you lived apart from your spouse for all of 2013, be sure you entered “D” to the right of the word “benefits” on Form 1040, line 20a, or on Form 1040A, line 14a. Military tax deduction             Yes. Military tax deduction Subtract line 9 from line 8 10. Military tax deduction       11. Military tax deduction Enter $12,000 if married filing jointly; $9,000 if single, head of household, qualifying widow(er), or married filing separately and you lived apart from your spouse for all of 2013 11. Military tax deduction       12. Military tax deduction Subtract line 11 from line 10. Military tax deduction If zero or less, enter -0- 12. Military tax deduction       13. Military tax deduction Enter the smaller of line 10 or line 11 13. Military tax deduction       14. Military tax deduction Enter one-half of line 13 14. Military tax deduction       15. Military tax deduction Enter the smaller of line 2 or line 14 15. Military tax deduction       16. Military tax deduction Multiply line 12 by 85% (. Military tax deduction 85). Military tax deduction If line 12 is zero, enter -0- 16. Military tax deduction       17. Military tax deduction Add lines 15 and 16 17. Military tax deduction       18. Military tax deduction Multiply line 1 by 85% (. Military tax deduction 85) 18. Military tax deduction       19. Military tax deduction Taxable benefits. Military tax deduction Enter the smaller of line 17 or line 18. Military tax deduction Also enter this amount on Form 1040, line 20b, or Form 1040A, line 14b 19. Military tax deduction         If you received a lump-sum payment in 2013 that was for an earlier year, also complete Worksheet 2 or 3 and Worksheet 4 to see if you can report a lower taxable benefit. Military tax deduction         Worksheet 2. Military tax deduction Figure Your Additional Taxable Benefits (From a Lump-Sum Payment for a Year After 1993)     Enter earlier year 1. Military tax deduction Enter the total amount from box 5 of ALL your Forms SSA-1099 and RRB-1099 for the earlier year, plus the lump-sum payment for the earlier year received after that year 1. Military tax deduction             Note. Military tax deduction If line 1 is zero or less, skip lines 2 through 20 and enter -0- on line 21. Military tax deduction Otherwise, go on to line 2. Military tax deduction             2. Military tax deduction Enter one-half of line 1 2. Military tax deduction     3. Military tax deduction Enter your adjusted gross income for the earlier year 3. Military tax deduction     4. Military tax deduction Enter the total of any exclusions/adjustments you claimed in the earlier year for: Adoption benefits (Form 8839) Qualified U. Military tax deduction S. Military tax deduction savings bond interest (Form 8815) Student loan interest (Form 1040, page 1, or Form 1040A, page 1) Tuition and fees (Form 1040, page 1, or Form 1040A, page 1) Domestic production activities (for 2005 through 2012) (Form 1040, page 1) Foreign earned income or housing (Form 2555 or Form 2555-EZ) Certain income of bona fide residents of American Samoa (Form 4563) or Puerto Rico 4. Military tax deduction     5. Military tax deduction Enter any tax-exempt interest received in the earlier year 5. Military tax deduction     6. Military tax deduction Add lines 2 through 5 6. Military tax deduction     7. Military tax deduction Enter your taxable benefits for the earlier year that you previously reported 7. Military tax deduction     8. Military tax deduction Subtract line 7 from line 6 8. Military tax deduction     9. Military tax deduction If, for the earlier year, you were:     Married filing jointly, enter $32,000 Single, head of household, qualifying widow(er), married filing separately and you lived apart from your spouse for all of the earlier year, enter $25,000 9. Military tax deduction       Note. Military tax deduction If you were married filing separately and you lived with your spouse at any time during the earlier year, skip lines 9 through 16; multiply line 8 by 85% (. Military tax deduction 85) and enter the result on line 17. Military tax deduction Then go to line 18. Military tax deduction         10. Military tax deduction Is the amount on line 8 more than the amount on line 9?       No. Military tax deduction Skip lines 10 through 20 and enter -0- on line 21. Military tax deduction       Yes. Military tax deduction Subtract line 9 from line 8 10. Military tax deduction     11. Military tax deduction Enter $12,000 if married filing jointly for the earlier year; $9,000 if single, head of household, qualifying widow(er), or married filing separately and you lived apart from your spouse for all of the earlier year 11. Military tax deduction     12. Military tax deduction Subtract line 11 from line 10. Military tax deduction If zero or less, enter -0- 12. Military tax deduction     13. Military tax deduction Enter the smaller of line 10 or line 11 13. Military tax deduction     14. Military tax deduction Enter one-half of line 13 14. Military tax deduction     15. Military tax deduction Enter the smaller of line 2 or line 14 15. Military tax deduction     16. Military tax deduction Multiply line 12 by 85% (. Military tax deduction 85). Military tax deduction If line 12 is zero, enter -0- 16. Military tax deduction     17. Military tax deduction Add lines 15 and 16 17. Military tax deduction     18. Military tax deduction Multiply line 1 by 85% (. Military tax deduction 85) 18. Military tax deduction     19. Military tax deduction Refigured taxable benefits. Military tax deduction Enter the smaller of line 17 or line 18 19. Military tax deduction     20. Military tax deduction Enter your taxable benefits for the earlier year (or as refigured due to a previous lump-sum payment for the year) 20. Military tax deduction     21. Military tax deduction Additional taxable benefits. Military tax deduction Subtract line 20 from line 19. Military tax deduction Also enter this amount on Worksheet 4, line 20 21. Military tax deduction       Do not file an amended return for this earlier year. Military tax deduction Complete a separate Worksheet 2 or Worksheet 3 for each earlier year for which you received a lump-sum payment in 2013. Military tax deduction   Worksheet 3. Military tax deduction Figure Your Additional Taxable Benefits (From a Lump-Sum Payment for a Year Before 1994) Enter earlier year 1. Military tax deduction Enter the total amount from box 5 of ALL your Forms SSA-1099 and RRB-1099 for the earlier year, plus the lump-sum payment for the earlier year received after that year 1. Military tax deduction           Note. Military tax deduction If line 1 is zero or less, skip lines 2 through 13 and enter -0- on line 14. Military tax deduction Otherwise, go on to line 2. Military tax deduction           2. Military tax deduction Enter one-half of line 1 2. Military tax deduction     3. Military tax deduction Enter your adjusted gross income for the earlier year 3. Military tax deduction     4. Military tax deduction Enter the total of any exclusions/adjustments you claimed in the earlier year for: Qualified U. Military tax deduction S. Military tax deduction savings bond interest (Form 8815) Foreign earned income or housing (Form 2555 or Form 2555-EZ) Certain income of bona fide residents of American Samoa (Form 4563) or Puerto Rico 4. Military tax deduction     5. Military tax deduction Enter any tax-exempt interest received in the earlier year 5. Military tax deduction     6. Military tax deduction Add lines 2 through 5 6. Military tax deduction     7. Military tax deduction Enter your taxable benefits for the earlier year that you previously reported 7. Military tax deduction     8. Military tax deduction Subtract line 7 from line 6 8. Military tax deduction     9. Military tax deduction Enter $25,000 ($32,000 if married filing jointly for the earlier year; $-0- if married filing separately for the earlier year and you lived with your spouse at any time during the earlier year) 9. Military tax deduction     10. Military tax deduction Is the amount on line 8 more than the amount on line 9? No. Military tax deduction Skip lines 10 through 13 and enter -0- on line 14. Military tax deduction  Yes. Military tax deduction Subtract line 9 from line 8. Military tax deduction 10. Military tax deduction     11. Military tax deduction Enter one-half of line 10 11. Military tax deduction     12. Military tax deduction Refigured taxable benefits. Military tax deduction Enter the smaller of line 2 or line 11 12. Military tax deduction     13. Military tax deduction Enter your taxable benefits for the earlier year (or as refigured due to a previous